Policies to promote the evolution and productivity of production systems
Economics of organic fertiliser
Policies for sustainable land management
Environmental and natural resources degradation threatens both the economic prospects of future generations and the livelihood of current users. The cumulative effect of the operations of many smallholders is the primary contributor to the serious degradation of natural resources in developing countries. In SSA, increasing soil erosion reduces the capacity of many countries to produce food, and jeopardises the benefits from water resource development. Deforestation threatens biological diversity, and contributes to alteration of the global climate.
With growth in household income, the demand for livestock products is expected to grow, and livestock numbers are likely to grow as well. Much of the increase in livestock production is expected to come from developing countries, and mixed production systems will play an increasing role (Staal et al. 2001a). Appropriate policies are required to ensure that smallholders benefit from the increased demand for livestock products. It must be noted that the increase in production by smallholders should not come at the expense of environmental and natural resource degradation.
Ruminant livestock may have a net positive effect on the environment, particularly in the mixed crop–livestock systems. In such systems, good opportunities can clearly be made available through the contribution of intensive livestock production to soil fertility. Sustained intensification cannot fully take place without the resource enhancing and stabilising role of livestock (Fresco and Steinfeld 1997).
However, there could be some aspects of environmental harm that are caused by livestock and are not easily managed without reducing production levels. Appropriate measures are needed to internalise those costs in order to improve overall social and environmental welfare (Staal et al. 2001a). Beyond this, the key to capturing the potential benefit of livestock to the environment and natural resources base will depend on promoting the role of integrated crop–livestock production.
Changes in economic policies, property regimes and incentives to producers may be needed to solve the problems of resource and environmental degradation, to promote sustainable resource use by large and small enterprises and households, and to channel economic and demographic growth into activities that raise income and promote sustainable use of natural resources. Government policies and property rights arrangements have much to do with the use of natural resources in SSA. Existing land and tree tenure arrangements often discourage tree planting and encourage deforestation.
Four stages are defined in the process of animal agricultural intensification system (McIntire 1992). In the first stage, at low population density and abundance of land, crop and livestock production activities are extensive and specialised, with few interactions between cultivators and pastoralists. In the second stage, agriculture intensifies due to population growth and changes in market. There are more crop–livestock interactions with crop farmers using more animal power and manure, and with pastoralists using more crop residues for feed. Higher competition for land between cultivators and pastoralists also sets in. In the third stage, as population pressure increases further, cropland expands, while fallows and natural pasture contract. Further intensification increases the demand for more crop inputs in livestock production and for more livestock inputs in crop production. Increasing impediments to obtaining inputs in markets or through contracts promote closer integration of crop and livestock activities or mixed farms. Such impediments create economic incentives to provide inputs directly on farm, thus encouraging crop–livestock integration. In the fourth stage, if markets and exogenous technologies accompany further population growth, purchased inputs can replace crop–livestock integration, thereby developing specialised enterprises.
The evolution of production systems has been a focus of research for LPAP scientists in the first half of the 1990s. One such study was conducted in humid West Africa (Jabbar 1993b). Results indicated that cattle rearing in humid West Africa was nearly impossible in the past owing to the prevalence of trypanosomiasis. However, with increases in population pressure, jungle clearance, crop cultivation and tsetse control measures, the challenge has been reduced. As a result, there has been an influx of cattle owners who used to visit the zone only for dry season grazing and return to the safer subhumid/ semi-arid zone in the wet season. An increasing number of cattle owners have begun to settle in the humid zone by adapting mixed crop–livestock farming.
It has also been observed that there is a tendency among some local crop farmers to adopt livestock gradually in the farming system. Consequently, new farming systems are evolving in the zone. Results imply that research and development strategies should be aimed at supporting, accelerating, and helping to direct the natural forces of intensification of agriculture and the evolution and maturation of mixed crop–livestock farming systems. This is believed to make agriculture more productive, and sustainable, while at the same time improving the socio-economic conditions of the people. Such a strategy should adopt a resource management approach with land as the most critical resource. Possible research issues in this endeavour include determination of the environmental impact of animals; role and potential of manure in system sustainability and productivity; role of legumes (forage, crop and trees) in soil fertility, weed management, crop productivity and feed supply; and potential use of animals for traction with an efficient use of crop residue as livestock feed in the system.
Based on 66 randomly selected cattle owners, an assessment of the process and extent of sedentarisation in the derived savannah zone of south-western Nigeria indicated an ongoing process of sedentarisation (Jabbar et al. 1995). Herd sizes were larger among recent settlers; but with longer duration of settlement and with cattle herders' involvement in crop production, the herds became less mobile between seasons, and herd size decreased and the proportion of farms with mixed zebu/trypanotolerant cattle herds increased. Some indigenous crop growers became mixed crop–livestock farmers by purchasing cattle.
Results of a similar study in the derived savannah of south-western Nigeria showed that at the current stage of evolution, as a crop farmer adds livestock to his business, there is a small gain at the beginning, followed by an increasing rate of substitution between crop and livestock (Okuruwa et al. 1996). As a livestock keeper engages in crop production, there is a decreasing rate of substitution between livestock and crop, because crop production is more intensive than livestock production. If increased population pressure and cropping intensity severely limit access to grazing land, farm and herd sizes will become smaller. Then the degree of integration between crop and livestock will increase significantly.
Research results on the breed portfolio of settled farmers in southern Nigeria showed that farmers' breed portfolios are the outcomes of dynamic processes that vary both across farmers within and across micro-environments within an agro-ecological zone (Jabbar et al. 1994). Percentage of zebu animals in the herds of recently settled Fulani agro-pastoralists was inversely related to the length of time they have been settled. Farmers also consider a variety of characteristics of different breeds, and that their breed preferences are based on a composite of those characteristics. Breed preferences are then put into practice through a variety of actions. Overtime, the breed portfolio of the herd will change to reflect modified breed preferences.
In urban areas where transport costs of inputs and products are lower than in rural areas, specialised animal production such as milk or small ruminants or poultry production develop. These intensive production systems that are developing around cities represent what is called peri-urban livestock system. A study on the peri-urban livestock systems showed that the principal constraints to its development in SSA are technical, institutional, infrastructural and policy related (Ehui et al. 1995). Feed, animal health, genotype and livestock management are major technical constraints. In the policy area, despite substantial improvements in sector and macro policies, there is room for significant improvement in sectoral policies that affect dairying at all levels in the dairy system, all the way from production to consumption. The principal constraints of an institutional and infrastructural nature include inefficient support services as well as underdeveloped roads and markets. The potential for increasing peri-urban livestock production is directly related to the ability to intensify feed production and feeding strategies. Intensifying feeding requires higher levels of input either produced on-farm or purchased from the market.
In farming systems where food crops are grown in alleys formed by hedgerows of trees and shrubs, preferably legumes, the hedgerows are periodically pruned, and the pruning is applied as mulch for improving soil fertility, controlling erosion and increasing yields (Jabbar et al. 1992). Whether it is profitable to use part of the foliage as feed rather than as mulch depends mainly on crop response to mulching and animal response to feeding tree foliage. An economic analysis of on-farm agronomy and animal response trials in southern Nigeria showed that, at low crop yield level, and low crop response to mulching, feeding small ruminants with part of the foliage was profitable (Jabbar et al. 1992). Using 50% of the first season foliage as mulch and feeding the rest gave the highest total return from crop and animal. At higher yield levels, and high crop response to mulching, feeding animals was not profitable or only marginally profitable, at current prices.
A similar study by Reynolds and Jabbar (1994) showed that the major benefit from supplementing the diet of free roaming small ruminants in West Africa with the foliage of leguminous trees (Leucaena and Gliricidia) was an increase in survival, and the forage is best directed at late pregnant and lactating females. In East Africa, crossbred dairy cows show a significant response in milk production to supplementation with Leucaena.
Another angle of system evolution is the shift to intensification. Agricultural intensification involving greater crop–livestock interactions and integration is emerging as a promising strategy for improving agricultural production and productivity in much of SSA. In West Africa, where this process is at various stages of evolution, 559 farm households from the Sudan savannah (SS) and northern Guinea savannah (NGS) zones were studied to examine the factors affecting production efficiency (Okike et al. forthcoming). The farms in each zone were divided into four socio-economic domains using combination of population density and market access as criteria. The study tested the hypothesis that production efficiency of farms varied according to level of intensification, agro-ecological condition, population density and market access. Estimation of stochastic frontier production function indicated the need to include ecological and socio-economic variables in both the production function and the accompanying inefficiency equation; failure in such models may suffer from omitted variables bias. The results showed that inefficiency effects of a stochastic nature existed among the sample farms and average efficiency was 76% (68% in the SS and 86% in the NGS zones). Further, increased resource use associated with agricultural intensification was not always accompanied by an increase in production efficiency. While agricultural intensification based on high external input strategies yields higher marginal returns in the NGS, a similar strategy is not critical to success in the SS given current use levels and the biophysical endowments of the latter ecological zone. These results lead to the conclusion that while agricultural intensification and efficient production in the NGS still benefit from high external input use strategies, the same strategy is not critical for achieving similar results in the SS, given current levels of resource application in the latter ecology. Increasing agricultural productivity, even within the framework of the ranges provided by this study will depend on how seriously extension services are taken and how their programmes are carried out. Going by recent studies in West Africa on the performance of extension systems, a lot still needs to be done if extension systems are to be the preferred route of reaching farmers with new technologies including information.
System evolution studies also conducted comparative sectoral analysis to derive the lessons learned from the progress made under similar agro-ecological systems in other countries. For example, due to the similarities of the highland agro-ecological conditions of Kenya and Ethiopia, the development of the dairy sector in Ethiopia would benefit substantially from experience of neighbouring Kenya. In this regard, the development of the dairy sector in Ethiopia over the last 50 years was visited (Ahmed et al. 2003). In particular, the study presented an overview of the dairy sector in Ethiopia; identified key phases in the development of the sector and examined the trends in production and consumption, policy changes and development emphasis during each phase; provided evidence on the potential impact of improved dairy cattle and examines the factors that increase smallholder participation in market-oriented dairying; and identified key policy and technology issues to be considered in designing appropriate policy and development strategies. The paper also draws evidence from neighbouring countries in order to help understand dairy development strategies in Ethiopia.
According to the study, the dairy sector in Ethiopia has passed through three phases or turning points, following changes in the economic and political policy in the country. In the most recent phase, characterised by the transition towards market-oriented economy, the dairy sector appears to be moving towards a take-off stage. Liberalised markets and private sector investment and promotion of smallholder dairy are the main features of this phase. Milk production during the 1990s expanded at an annual rate of 3.0% compared to 1.63–1.66% during the preceding three decades. However, most of the growth in milk production (60%) was due to the increase in herd size. Only one-quarter was due to productivity per animal resulting from technological change. This is not surprising since dairy production in the country is principally dependent on indigenous zebu breeds. Therefore, integration of crossbred cattle to the sector is imperative for dairy development in the country. This can be achieved in two ways: (1) through promotion of large private investment, which at the end will introduce new technology in the sector such as improved genotypes, feed and processing, and (2) as smallholders will likely continue dominating the sector, the government should also promote integration of crossbred cattle into the smallholder sector through improving their access to improved cattle breeds, AI service, veterinary service and credit. Similarly, the government should also take the lead in building infrastructure and providing technical service to smallholders. Severe shortages, low quality and seasonal unavailability of feed remain the major constraints to livestock production in Ethiopia. These constraints need to be addressed and technological change be promoted to increase milk production.
There are several lessons to be learned from the Kenyan experience. There is a need to focus interventions more coherently. Development interventions should be aimed at addressing both technological gaps and marketing problems. If the appropriate producer price incentives are in place and input markets are allowed to operate freely, dairy production may respond positively. This has been demonstrated in the Kenyan dairy development that has to some extent similar agro-ecology and production systems. Milk groups and co-operatives increase the participation of smallholder in fluid milk markets in the Ethiopian highlands. Milk groups are a simple example of an agro-industrial innovation, but they are only a necessary first step in the process of developing more sophisticated co-operative organisations and well-functioning dairy markets. The survival of the milk groups that supply inputs and process and market dairy products will depend on their continued ability to capture value-added dairy processing and return that value-added benefits to their members. Evidence from Kenya emphasises the importance of milk collection organisations in improving access to market and expanding productive bases (Staal 1995). Also there is a need to stimulate consumption of dairy products in the country as low demand for dairy produce can potentially discourage production in the long run.
One area of research where ILCA's socio-economics division and LPAP scientists worked on was the role of animal manure in maintaining soil fertility. In the semi-arid West Africa, animal manure is an integral component of soil fertility management practices. Soils in the region are deficient in nutrients, particularly in phosphorus and nitrogen (Williams et al. 1995). The use of inorganic fertiliser is limited in the region due to low rural incomes, high cost of fertiliser, inappropriate public policies and infrastructural constraints. Research on the role of manure showed that manure increases yields of crops and forages. It augments soil organic matter content, raises soil Ph, improves nutrient exchange and water holding capacity of soil and, when sufficient amount is supplied on a continuous basis, permits stable intensified crop production (Williams et al. 1995). However, despite the vital role of manure for crop production, availability of the input in sufficient quantity remains a critical problem.
A similar study in Niger confirms that aggregate livestock population and species composition is a key factor that may effectively limit the amount of manure available for crop production. Hence, external inputs in the form of inorganic fertiliser are needed to augment the available manure to sustain crop production, even considering the role of fallow, and the possibility of increased manure collection (Williams et al. 1995). Since the gap between the current use of inorganic fertiliser and the amount needed to supplement available manure is wide, appropriate public policies are needed to alleviate the constraints of increased use of inorganic fertilisers.
In collaboration with IFPRI scientists, the project on 'Policies for sustainable land management in the highlands of eastern Africa' was initiated in 1997. In the Ethiopian highlands, the interrelated problems of soil erosion, soil nutrient depletion, deforestation and limited soil moisture appear to be the most critical land management problems, resulting in substantial costs in the region. The proximate causes of these problems include rugged topography, thin soils, and low and uncertain rainfall. Moreover, farmers' practices regarding land management, including land use, crop choice, adoption of soil and water conservation measures, soil fertility management practices, grazing practices, use of agricultural inputs etc. have contributed to the problem. Farmers' practices are conditioned by many socio-economic and institutional factors, the most important of which are population pressure, poverty, land tenure, local market development, local institutional and organisational development, and farmers' perceptions and attitudes.
Many of these socio-economic and institutional factors affecting land management are influenced by many government policies and programmes, particularly policies affecting distribution and leasing of land, agricultural research and extension, input marketing, credit, irrigation development, road and other infrastructure development, development of farmers organisations and local institutions, and soil and water conservation programmes.
However, since the underlying causes depend upon many site-specific factors that vary greatly across the diverse circumstances of the region, no 'one-size-fits-all' policy, institutional or technology strategy is likely to suffice to generate sustainable development. While common elements of successful strategies such as security and macro-economic stability do exist, the appropriate portfolio of investment in physical, human, natural and social capital will likely be different in different circumstances.
The appropriate strategy for sustainable development is, therefore, likely to depend on the 'pathways of development'4 that are feasible in a given location. Such development pathways are largely determined by three factors that influence comparative advantage: agricultural potential, market access and population pressure. Results of the analysis of data from the Ethiopian highlands showed that population growth has a negative impact on resource conditions and human welfare (Pender et al 2001). Increase in population pressure results in reduced soil fertility, deterioration in resource and welfare conditions and reduced ownership of livestock. However, improved market access contributed to improvements in soil fertility and conservation, resource and human welfare conditions, ownership of livestock and use of animal health services. These results imply that better market access, credit, and extension programmes can provide win–win development strategies to reduce land degradation and poverty. It was also shown that community resource management might contribute to sustainable use of woodlots and grazing lands (Benin and Pender 2002; Berhanu et al. forthcoming).
4. Development pathways represent common patterns of change in economic livelihood strategies.
The overall findings of the project on policies for sustainable land management are summarised in a recent paper prepared for the plenary session on Environmental Stewardship of the 25th International Conference of Agricultural Economists.5 The paper combined the experience from East Africa with similar research in West Africa. In this paper, Ehui and Pender (2003) argued that no one strategy for sustainable development would work for SSA. The key is to identify and implement effective policies and strategies for different circumstances in the region. Essential to such strategies will be investment in an appropriate portfolio of physical, human, natural and social capital. The appropriate portfolio of such investments will differ from one place to another depending upon differences in potential comparative advantage, which determine the private and social profitability of different investments.
5. Other findings at the regional level in Ethiopia were summarised in Benin et al. (2003f), and Berhanu and Swinton (2003).
In the East African highlands, great potential exists for increasing agricultural production, reducing poverty and land degradation in the high potential areas with good market access. Central Kenya stands out as an example of successful development, offering promise of similar development in areas of similar comparative advantages. However, the highlands of Central Kenya have a number of advantages that are not present to the same extent in these other areas. These include a well-developed infrastructure and market institutions, farmers' access to credit through coffee and tea co-operatives, a strong commercial orientation of farmers, presence of a merchant class with considerable international experience, and development of long-term relationships with buyers in international markets. Realisation of the potential in other regions can be facilitated by public investments to help reduce transportation costs, develop market institutions, increase farmer access to information and technical assistance about market opportunities and appropriate technologies, develop agricultural inputs and credit markets, promote development of the non-farm economy, and increase sustainable use of degraded and uncultivated lands. In addition to direct investments (e.g. investments in infrastructure, education and other public goods), policies that can help promote private investments in these areas include continued avoidance of over-valued exchange rates, establishment of grades and standards for grains and other commodities, establishing a legal framework for a warehouse receipts system to promote the availability of marketing credit, reduction of taxes on imported vehicles and spare parts, and providing secure property rights for private use of degraded and unused lands.
In highland regions with good agricultural potential but low market access, high value perennial crops such as coffee are important. Agricultural research and extension will continue to be important to provide technologies that increase productivity and reduce susceptibility of these crops. Where there is a comparative advantage in perennial cash crop production in land scarce environments, increasing productivity in food production will be critical to avoid subsistence food requirements from displacing cash crop production. Demand for purchased inputs such as fertiliser for cash crops may be limited in such areas (as in south-western Ethiopia), but there may be potential to increase productivity by using inputs in food crop production. In this case, earnings from cash crop production can finance increased food productivity in order to free up land for more cash crop production. In this situation, it is important not to over promote food production, since this may simply lead to local surpluses that may not benefit farmers. In areas where the comparative advantage is in cereal production, greater emphasis on production enhancement can be more beneficial. But improvement in infrastructure and marketing systems will also be critical to realise the potential of these commodities. Improvement in livestock production can be a successful strategy by promoting more crop as well as livestock production, higher income, and reduced soil nutrient depletion, as seen in Uganda.
In the low potential areas of the highlands, there exist profitable investments that can increase agricultural production, income and reduce land degradation. Intensive food production using high levels of fertilisers and improved seeds is risky and not likely profitable in such areas without significant investment in water management. Soil and water conservation measures can provide high returns in such environments by conserving scarce soil moisture and enabling greater use of inputs. Other profitable land management practices include reduced tillage, reduced burning and composting. As found in northern Ethiopia, the comparative advantage of the low potential highlands is likely for more livestock production and tree planting than for intensive cereal production. Livestock development in this environment offers a potential win–win strategy capable of increasing productivity and incomes, and of reducing land degradation. Realising the potential of improved livestock and crop production and tree planting in these areas will require improved institutions for managing communal lands. Other opportunities include investment in education, market institutions such as marketing co-operatives, and development of the non-farm economy. Despite all of these opportunities, such areas are likely in the near term to remain dependent upon safety nets such as food-for-work programmes or other employment guarantee schemes to prevent famine when farmers' incomes are decimated by droughts. In the long run, the risk of famine can only be eliminated by overall development of the economy, providing a more guaranteed source of employment and income.
Within the humid zone in West Africa, since the greatest potential is for root and tree crops, providing disease-resistant varieties of those crops that respond well to small amounts of purchased inputs will be needed. In addition, investments in roads and markets should have a high priority. The humid zone also offers high potential for meat production through disease resistant breeds, such as the N'Dama, and improving health delivery systems and digestibility of the plentiful biomass in the zone. In the subhumid zone, because crop–livestock systems are more common, introducing disease resistant animal breeds and improving health infrastructure are the key elements.
Since livestock production is important in the semi-arid zone, policy strategies should focus on extension, education and credit in livestock fattening programmes. Milk production and improved marketing and health facilities should also be facilitated. In the arid zone, providing drought-resistant crop varieties and improving property rights to pastures and water resources should be emphasised.
In general, the empirical evidence reviewed confirms that different strategies are needed in different development domains of SSA. Nevertheless, some elements will be common to all successful strategies, including assurance of peace and security, a stable macro-economic environment, provision of incentives through functional markets, development of market institutions for those that do not function, and public and private investment in an appropriate mix of physical, human, natural and social capital. The differences in strategies across these domains mainly reflect differences in the mix of those investments as influenced by different comparative advantages.
